- 61% of pending orders in the 100-pip range are to SELL the Pound
- 54% of traders are bearish on the Sterling (-2%)
- Bank Holiday in US
- Upcoming events: BOE Governor Carney to speak
Initially, the British Pound rose against the US Dollar despite lower-than-expected UK retail sales data, growing 11 base points to the 1.4118 mark. However, the GBP/USD pair went towards anticipated direction remaining in the short-term bearish trend.
Britain's shop sales appreciated less than anticipated in January, confirming the cautiousness of consumer spending in the reported period. The Office for National Statistics revealed that the volume of retail sales increased only 0.1%, following the revised drop of 1.4% in the prior month. However, the increase was brought by declines in all leading sectors with an exeption of non-food stores, which was associated with "getting fit" New Year's resolutions increasing the sales.
Calm session
Banks in the United States are closed due to President's Day. Meanwhile, BOE Governor Mark Carney is set to speak about leadership and values at Regent's University at 1845GMT.
GBP/USD bounded by SMAs
Following a test of 1.4150 on Friday morning, downside risks took over the market and pushed the rate 0.92% lower during the following hours. As a result, the pair was testing the weekly PP and the 100-hour SMA circa 1.40 early today. It is likely that this psychological level provides an unbreakable support, thus allowing for further gains in this session.
The rate could demonstrate low volatility, especially if no fundamentals are scheduled until the evening. Thus, the Pound could fluctuate between the 55– and 100-hour moving averages for a brief period of time before breaching the former and approaching the weekly R1 at 1.4204.
Meanwhile, the lowest point today should be the 200-hour SMA and the 38.20% Fibo retracement at 1.3950.
Hourly chart
The strong bullish sentiment which guided the pair last week was reversed on Friday. The prevailing four-month channel suggests that the pair could still move higher, possibly up to the 1.46 mark where the upper boundary of the senior channel, the monthly R1 and the 50.0% Fibo retracement are located.
Daily Chart
The bearish market sentiment continues to prevail, as 54% of traders are holding short positions (-2%). Meanwhile, 59% of pending orders are to buy the pair.
The market sentiment of OANDA traders has turned bearish with 55% short positions (+3%). Saxo Bank clients are likewise bearish with 54% short positions (-6%).
Spreads (avg, pip) / Trading volume / Volatility